Blog

Energy assessments identify big savings for big customers

Our Energy Assessments are designed to pinpoint any inefficiencies and source real savings for your business.

ERM Power’s Executive General Manager, Energy Solutions Megan Houghton says many larger customers that ERM have worked with are unaware that these savings are possible.

“We’ve noticed that most businesses are preoccupied with their day-to-day tasks and targets and they don’t necessarily have the internal capabilities or resources to know when an energy management opportunity exists.

“Companies want to save money and remain competitive. What they don’t always recognise is that energy is probably one of the biggest variable costs they can reduce to improve their bottom line.”

Excluding raw materials, energy typically accounts for between 10-20% of the total operational cost for a business, explains Megan.

“While it’s often difficult to cut down on labour and other operating costs, energy cost reductions are much easier. It’s not unusual for us to identify potential savings of greater than 20% through energy productivity measures. It definitely has a big impact.”

Why expensive inefficiencies happen

A recurring issue is that companies tend to make operating decisions based on immediate functional requirements, which can negatively affect their energy efficiency and their bottom line over time.

“If a company makes changes to their equipment or the way they run it, not for energy management, but for the fastest way to get it up and running, this can have a very negative impact on their energy efficiency,” says Megan.

“We’ve seen this with customers who update a piece of equipment without considering the overall system impact. It can be highly inefficient and very costly.”

When customers weigh up investment decisions, they should consider energy efficiency and lifecycle costs as part of the operating requirement decisions.

“When a company upgrades an important piece of equipment, the upfront capital cost of that is only a few per cent of the overall lifecycle cost. Energy and maintenance represent the majority of the total lifecycle cost.”

Simple solutions with a big payoff

Many customers don’t realise that solutions identified through an Energy Assessment can often be quite simple– yet they still result in significant savings and energy consumption reductions.

“An Energy Assessment isn’t just about lighting or solar, it focuses on simple things a customer can do right away. A lot of these opportunities are about getting in there and understanding what a customer needs and comparing that to what they’re currently using,” says Megan.

“It’s then about changing the way they operate their equipment to match the demand of their services. Motor control and changes to software and building management systems can be straightforward solutions that result in a healthy return.”

Payback periods can vary depending on how sophisticated the solution is, but even simpler solutions that require a small capital outlay can deliver significant savings and short payback periods, says Megan.

The most common thing we hear from customers is that our Energy Assessments reveal issues that would have otherwise gone unnoticed.

“When customers get into business-as-usual mode, they don’t see how things could be done differently. A lot of the time, companies don’t have the internal resources available to examine how they’re using energy,” says Megan.

“It’s only when you break it down into the individual equipment level that you can see the comparison and start to make sense of your operations and the energy data. Energy data isn’t always straightforward for companies not operating in the industry.

“We put loggers in, we measure all of these loads, we do an energy balance of the site and we start asking questions. When we do these things, it helps customers work out where the issues are and find potential improvement opportunities.”

The data gathered during an Energy Assessment can also be highly beneficial to customers and can improve their productivity, Megan explains.

“We try to understand how things are used over the weekend or when equipment is not needed. This information can often drive behavioural changes.

“Customers become more conscious of what they actually use, which can have a positive impact on the way things run.”